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If the project proceeds as planned, Portage Place will be demolished and a residential tower will be constructed one side of the building, with nearly half of the residential space being dedicated for affordable housing.Handout

An organization representing 34 First Nations in southern Manitoba has signed a multiyear agreement with a prominent real-estate developer that has the potential to revive Winnipeg’s struggling downtown core.

True North Real Estate Development, an arm of the company that owns the Winnipeg Jets, is planning to work with the Southern Chiefs’ Organization on rebuilding two key properties in the city: the beleaguered Portage Place mall and a shuttered, six-storey Hudson’s Bay store.

The revitalization would provide a much-needed boost for an otherwise dwindling local economy, according to the federal, provincial and municipal governments. “Winnipeg’s downtown is Manitoba’s downtown,” Premier Wab Kinew told reporters at the project’s announcement on Tuesday.

“People from across our great province come here for a night out to watch a hockey game, to see a concert, to grab a bite to eat. This is where deals are going to be made. This is where clients and investors are going to be hosted,” Mr. Kinew said. “The investments that we make into downtown will pay dividends in terms of future economic activity.”

If the redevelopment proceeds as planned, Portage Place will be demolished to have a residential tower installed on one side of the building and a medical tower on the other. Nearly half of the residential space would be dedicated to affordable housing. The middle section of what is currently a mall would be converted into community centres, offices and retail or food services.

Across the street, the former Bay building that was gifted last year to the Southern Chiefs’ Organization – now named Wehwehneh Bahgahkinahgohn, meaning “It Is Visible” in the Anishinaabemowin language – will become a mixed-use property. It will have hundreds of affordable units for elders and university students. There will also be a museum, an art gallery, a health centre, at least two restaurants and a memorial for residential school victims and survivors.

“This is what true economic reconciliation looks like,” said Grand Chief Jerry Daniels. “Together, we’ll work to make downtown Winnipeg a vibrant, livable, workable and safe place.”

Last week, True North received approval on a six-month extension before it decides whether to purchase Portage Place. The company said it needed to perform more due diligence on the mall, which is currently owned by the Vancouver-based Peterson Group.

In an interview Tuesday, True North president Jim Ludlow said the company’s plans are “just short of a full go-ahead.” He said while the agreement with the Chiefs’ Organization is “not legally binding, it is binding in principle.”

“Our goal is to get there,” Mr. Ludlow said. “There are a lot of partners that have to move forward at the same time: design, construction, the bank, one level of government, the next level of government. We just have to allow that same amount of time for everybody to stay in that same lockstep.”

As downtown Winnipeg grapples with rising poverty, vacant storefronts and other social issues, Portage Place and the Bay building are powerful symbols of decline.

Kate Kehler, executive director of the Social Planning Council of Winnipeg, said the mall had performed a vital community service. “We need to have places where people can gather,” she said, citing Portage Place and the city’s Millennium Library as about the only places downtown where locals can pass time without having to spend money.

Ms. Kehler said that although True North has made positive noise for its proposals, it remains to be seen how their plans will meet the needs of some of the poorest people across the country.

In a previous interview this summer, when asked about True North’s burgeoning presence in Winnipeg, Mr. Ludlow said the company thought about this a lot. Choosing his words carefully, and acknowledging that this sentiment could come across oddly, he said: “If not us, who?”

There isn’t a long list of other suitors. Even as True North increases its downtown holdings, Winnipeg has found it difficult to attract other investors.

Earlier this year, the city’s mayor, Scott Gillingham, said perceptions about downtown safety were weighing on Jets attendance and ticket sales for the local arts sector.

On Tuesday, he called the new project a “game-changer” for the city to move in a more positive direction.

David Thomson, who sits on the board of True North Sports + Entertainment and is a partner for True North through his real-estate firm Osmington Inc., was also present at Tuesday’s announcement. The Thomson family’s holding company, Woodbridge Co. Ltd., owns The Globe and Mail.

Initially planned to cost $130-million, the Bay building’s redevelopment is now slated to cost around $200-million. The price on the Portage Place plan has also increased to $650-million from $550-million, according to True North and the Chiefs’ Organization.

By mid-2024, True North expects to sign another agreement on multifamily ownership and other investments at the properties, which have a combined footprint of nearly two million square feet.

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